As CEO of one of the fastest-growing fintech lenders in the UK, I’ve helped founders grow through calm and chaos. Right now, growth feels harder than ever.
Nearly one million UK SMEs fear closure following April’s rise in employer National Insurance, minimum wage, and capital gains tax. At the same time, the British Chambers of Commerce shows fewer than half of small firms expect sales to increase this year.
Hiring is on pause. Expansion plans are being pushed back.
And this pressure is not just local. Global businesses are also bracing for the OECD’s new digital tax framework, which adds fresh layers of complexity
for companies trading across borders.
This climate is tough. But it is not impossible. In this article, I’ll draw on lessons from corporate finance and day-to-day conversations with founders
to share how businesses can still move forward. Not by pushing harder. But by growing smarter. With capital that fits. And choices that protect both margins and momentum.
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The Cost Squeeze Is Real
Founders are not overreacting. It’s written into the data.
In 2024, the UK government raised the National Living Wage by 9.8 percent. At the same time, employer National Insurance contributions increased, and capital
gains tax relief was reduced. Individually, these measures seem manageable. Together, they push many small businesses closer to the edge.
Official data from the Office for National Statistics shows a decline of around 115,000 payrolled employees between April 2024 and April 2025—highlighting
increased cost pressures on employers (ONS
June 2025 bulletin).
These changes aren’t minor. Combined with energy and rent hikes, many SMEs are freezing hires and delaying expansion. In a government-funded Business Insights
and Conditions Survey, 18 percent of firms planned to raise prices in early 2025, directly tied to rising labour costs (UK Commons Library).
I’ve spoken with dozens of founders who are cutting back, not because they want to, but because they feel they have no choice. Hiring freezes, delayed
stock orders, and paused marketing campaigns are now common. For some, survival means shrinking.
But this can be a trap. Cutting back on everything rarely leads to stability. It just slows momentum. The smarter move is to understand what the business
really needs to keep going and grow with intention.
The pressure is real. But so is the opportunity to step back and reset. Businesses that focus on their fundamentals now can put themselves in a stronger
position when conditions improve.
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Growth Is Still Possible. Just Smarter
Cutting back is the obvious move. But staying small doesn’t protect a business. It just makes it harder to move when the time is right.
I’ve worked with founders who thought the only option was to shrink. The ones who kept growing were the ones who made better, not bigger, decisions.
Smart growth isn’t about taking more risk. It’s about using what you already have more effectively.
Some examples:
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Double down on what sells: Shift focus to top-performing products. Pause the rest.
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Hold off on hiring, improve how teams work: Automate admin. Free up time for work that drives revenue.
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Cut noise from your marketing: Focus on the channels that convert. Park the rest for now.
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Review operations: Batch fulfilment. Renegotiate terms. Trim costs without cutting corners.
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Strengthen customer relationships: Drive more value from the people who already buy from you.
Moves like these create breathing room. You don’t need to go bigger to make progress. You just need to go sharper.
Now is also the time to understand your margins. Revenue doesn’t build resilience, profit does.
Founders who adjust early give themselves more options. Growth is possible. But now, it has to be intentional.
3: Secure the Right Kind of Capital
Not all capital helps. In this environment, the wrong funding can make pressure worse.
I’ve seen businesses take on short-term loans to solve cash flow gaps, at high cost, only to find repayments kicking in before the revenue arrives. That
kind of stress limits flexibility and makes every decision feel urgent.
Now is the time to look closely at the shape of your finance. Ask what the money is for. Ask how long you’ll need it. Ask what happens if things go slower
than planned.
Good funding gives you room to move. It should match how your business operates, not how a lender’s model works.
What to look for:
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Terms that follow your cycle: Seasonal businesses need seasonal repayments. Marketing-driven brands need space to test and scale.
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Repayment plans that flex: Look for capital that adjusts to performance, not fixed schedules that ignore your revenue flow.
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No surprise costs: Understand the full cost up front. Clarity is more important than headline rates.
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Support that adds value: Some lenders just send money. Others share insight. Choose the ones that help you make better decisions.
Founders don’t need more credit. They need the right kind. Capital that creates headroom, not pressure.
Now more than ever, funding should follow the business, not the other way around.
This is a hard year for small businesses. Costs are up. Confidence is low.
The businesses that make it through won’t just be the ones that cut back. They’ll be the ones that grow smarter, not bigger. The ones that rethink how
they hire, how they sell, and how they fund.
Quick recap:
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Cost pressure is real: National Insurance, wages, and operating expenses have changed the math for many.
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Growth is still on the table: But it needs focus, margin clarity, and sharper decision-making.
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Capital should fit: It’s not about more funding. It’s about the kind that actually helps you grow.
I’ve worked with founders long enough to know that resilience isn’t about luck. It’s about planning, timing, and knowing when to change the rules.
So here’s the question: What would growing smarter look like for your business this year?
